I currently have a 30 year loan on my house, have owned it for 5 years, made extra payments for a long time.  The loan was at 7.875% rate.

My payment is $441 a month, and I make an additional $210 principle payment.

If I continue doing this, I will have the house paid off in another 6 years.

However, I am seeing all these really low rates out there and am wondering if refinancing would be a good option.

What is my "break even" point when refinancing?  Obviously, there are closing costs involved in doing a re-fi, so I am wondering if I might actually end up paying the same or more if I refinance.

Anyone have the answers here?

BTW - I also have a home equity line of credit at 5.5%, and currently have $10,000 on it - if I re-financed, I'd probably want to roll that $10,000 into the re-fi as well - so my total refinanced amount would be the balance on my home ($38,000) plus the $10,000 on the equity line.

Well, you didn't give us all the info - did you include insurance and taxes in that?  how long are you going to be in the home?  

If you're going to be there longer than 2 years and you're thinking about trying to pay it off in 6, a much shorter term will save you a lot of money.  

If you consider that a 10-year loan at 5.375% will cost you about $518 P&I (e.g. not including taxes and insurance) for $48K, or a 7/23 at 5.125% will run you about $262 and you can add more principle payments to pay it down more quickly, you can save a lot in interest fairly quickly - roughly $100 a month - so you figure it out.  Streamlined refi's are cheap nowadays, but I'm not sure just how cheap - ask a local credit union or bank how much they run for your loan amount.

You need to find out from perspective lenders what their closing costs will be.  That cost is paid by you.  The so-called "no point, no fees" loans are anything but.  You pay those cost one way or the other.  What I mean by this is, either you pay it up front out of your pocket or in the case of no point no fees, it will be added to your total loan amount, so instead of paying it up front, you're financing the closing cost over the life of the loan.

The break even point will be the difference in between your new payment and your old times the number of payment necessary to equal the total closing cost.

If that sounds confusing, email me and I'll see if I can explain it better.

I am a Mortgage Broker so let me see if I can shed some light on this.  

Closing cost will range anywhere from 1-5% of the loan amount.  What you need to do is figure out what your loan amount would be, then figure the dollar amount based upon said figures.  

The thing to consider is that you could change the term on the loan from 30 to 20,10 or even 5 years.  Your payments may stay the same, but you'll pay it off that much faster.

I don't know if you escrow or not, but depending on which lender you go with you may or may not have to pay a fee (or take a slightly higher rate) if you opt not to escrow through them.

Regardless of what you see on the "Ditech" ad's THERE ARE ALWAYS CLOSING COSTS!!!!!

If you like, I can run a preliminary application for you to see what rates you qualify for.  It is in no way binding and it won't cost you a dime.

Take care,

Josh

[email protected]

Do it!....The rate are not staying this low forever.

I'd roll it all into a 15 year note at the lowest possible rate, then continue to pre-pay as you have been doing.